Richcpaman

Send them whatever you feel is appropriate. But my answer would have been simple. Mom and Dad still claim the kid, thank you for the gift for the tuition, now get me a 1098T Rich

Probably another 50 to come in to get done, 200 or so in the hopper to complete... The RACE is ON! Rich

I am with AB regarding this as well. If I had to spend 4 hours drafting the response to the IRS for whether or not the kids lived with her? I know she is going to lose... Rich

BB: I wish a could post the voice mail message I received from the IRS. And its all about $250... Rich

SFA: With the above statement? You have to return all the documents to both of them. One of them is right, both of them are wrong. And you are stuck in the middle. You have to choose, and I believe your best answer is to let them both go. The 8867 disclosure form and potential penalty ($500 each client, notwithstanding they look at every ONE of your 8867's if they look at one) put you into the position that you DO have to interrogate your clients. Its no longer reasonable that we ask them some casual questions, accept them at face value, and go from there. The risk is too great. In this particular case, you DO have to interrogate. Have you been involved in divorces cases before? They have lawyers. And they like to beat up on folks if it makes sense for their clients, and if our clients have gained or lost tax deductions or credits like the EITC. AOTC, CTC or whatever, and its because you didn't do your due diligence, then its a real bad day for you. I have plenty of clients that I love both spouses, and their kids, but in a divorce, the rules change, and I am very wary. And hiding behind the disclosure rules isn't going to help you. I would recommend that you ask each client who is representing them in the divorce. If they do not have representation, that is fine, but you have to ask. And if they do have representation, then you need to ask that representation some of the following questions: 1. Has there been any signed agreements between the parties? What is the status of any agreements? 2. Who has legal custody of the children? 3. Who is in the family home? Has something happened to it? Have both parties moved? 4. Child support or alimony? Has there been any arrangements for same? 5. Some other stuff that may be pertinent to your particular clients. Rich

JK: They may not "impute" income, but they will do what you describe, which is to disallow all the deductions, and show all the use a personal. Rich

Under JohnH's scenario: No rent being charged, and you deduct the RE Taxes on the house. IRS can not impute income, because there is no rent being charged, and no expenses trying to be taken. (Ie., depreciation, utilities, insurance, repairs, etc, etc.) Under EasyTax's: There is rent being paid for the house. Not enough for FMV, but payments are being made. Maybe he is not in the business of renting property, so maybe the rent is reduced by expenses and goes to Line 21. Otherwise, the IRS would impute income, and then create a Sch E for your client. Because he is getting $$. It may only be to help defray costs, but could you send me couple hundred every month to help me defray costs? Rich

Baby eagles are called Eaglets. Tom, you will see all sorts of them in Alaska. Still makes me want to pullover and watch when I see them in the morning.

WiTaxLady: Wow. That is a lot of stuff going on. The ATX extension process is a PITA. Roll it over, go to each one, 13-20 steps later, you have two extensions that can be efiled. Stupid. They have the process from the Return Manager that will "print" your extensions... but that doesn't help to efiling, and your computer is locked up for 4 hours while it processes them all. How do I know I am 16% ahead of last year? How many engaged to prepare now as compared to the same date last year. 350/300=16% But we are not keeping up with getting them done.. Rich

Terry: The general rule is that the IRS will disallow "bargain" rentals to related parties. Even to unrelated if no reasonable attempts to collect the rent are made. If the market rate is $1,000 a month, and your client is charging the Daughter $500, then the IRS upon examination can impute additional rent income for the missing $500 for all the open periods. There is allowance for some discount, and the IRS refuses to define what the discount might be. 50% is probably too high. 80% might be right. I explain this to my clients and we make the adjustments to the Sch E. Get info from some realtors for market rent for similar properties in that area and go from there. Rich

Yes, the December to February period we see them on the way to work regularly. Glad you got to see one. It is pretty cool. Rich

But she was getting $600 to prep that return! Raise your fees! If a stripper can bill it, so can you!

Here you go... https://www.youtube.com/watch?v=Blm97aYDllg The fun starts at 1:12... A Fee Dispute on "Judge Faith" Rich

Mine? Wants to sell her business... Killing me to update her Qbooks Online accounting so she can send it to all the "prospective" buyers. So, I do all the updating... Did I tell you that anyone who uses the Qbooks Online Edition deserves a hug? Yes. Everyone. Send her an Email, ok, everything looks good, I can prep the corporate return now, and you can send that Qbooks info anywhere you want, but.... Why did you stop paying your sales tax in October? Her reply? "Oh, that? I started making all the "cash" deposits into a new and different account that I do not include in the QBO file...." Yes, she is 5'4" and wide. Rich

That dude it SCREWED. Offer in Compromise? When you are an @sshole Mortgage Broker? Yeah, right. Agree to the audit changes, expand it to years that are still open, and the understatement penalty, we are talking probably serious dollars here. And then OIC it all away??? Not going to happen. Some folks just need to get bent over. And I hope the IRS does and without any further lube. Rich

Deb: Good job. They can't even lie right... "Called several CPA's and the IRS!" Yeah, RIGHT. Tax Pro Today newsletter lists preparer's every week doing exactly what the other preparer did here. You brought the voice of reason and what is right. They left, Good. And those Schedule C's were garbage anyway. Always a Loss? But they have money to "loan" the biz? Right. Sheesh. Rich

I am behind, but also ahead. I have engaged 16% more returns then I had in the office last year at this same time, so that makes me ahead. My completion rate is on par with the prior year, so that is good. But I am behind in billing, and that is troubling. Otherwise, its 29 days left... Rich

Roberts: I will score the Tix with some others, and then we will junket down to the Masters. Probably rent a large RV to sleep in, and of course for me, I will take the laptop to stay on top of things. I know that Tix are available around the gate, but I do not want to have to guess. I am in the drawing for Tix that the Masters holds, if I get selected, then that is the year to go.... Otherwise, my golf group goes to North Carolina in Mid-March for 4 days of golf. Haven't been able to go in the past, but think I can in the future... I am missing some time during tax season anyway, so might as well continue later with something fun. Rich

Sara: And that is where I say we make a difference. If your practice becomes too much drop off, and no personal contact, it becomes a commodity, and the client moving on to the next preparer gets much easier. I would hope to have time to say hello to my clients, even if it is for hand holding. I meet a large majority of my clients at drop off. We get to talk then about the return, so the follow up is email or some phone calls, and I do not meet with as many at pick up. I also offer to meet after tax season free of charge to go over "other things" that need more time. Clients do get in the way of us getting work done....But they are why we have work. I get a lot of biz from other preparers who stop meeting their clients. Rich

When I secure tickets to the Masters.... I am out of the office for a week in April. Clients be damned. I had to go to San Diego for week in January for Rotary this year, however. Rich

After I bought a portion of another guys tax practice, I replaced the chairs that were in front of the desk. I went from straight back plastic chairs to some leather-like products from Staples. He told after seeing them: "What did you go and do that for? You don't want them hanging around!" I should listen to him. Rich

You should have heard the blue streak on Tuesday night....

Deb: Needless to say, you are right, but you will not be doing those returns in the future. Send them a note next year, "Call me when you need me" Because the preparer that is giving them the "Nurse's Meals" is also giving the "Fireman's and Policeman's Meal's" deductions as well. Not withstanding the fake $14k Sch C so you can claim the full EITC.. Rich

Then you laugh ALOT! Rich

Yes. It doesn't matter what they did with the "gift" cash. The RE Taxes were paid. They meet all the other requirements. Client wants to deduct them, because parents probably get very little benefit from the deduction, but client might. But daughter loses the test. Rich